West End office rents have risen for the first time in three years, according to research by Jones Lang LaSalle (JLL).
Rental rates increased to £85 per square foot in the second quarter, up from £75 per square foot in the first quarter. The real estate firm expects rents to hit £87.50 per square foot by the end of 2010.
Jonathan Evans, Head of West End agency and development at JLL, said: “We have witnessed a real sea change in the West End over the past couple of months as prime office rents continued to strengthen in the second quarter”.
He continued: “This has been driven by several deals in the limited amount of prime space, and given this is the first rental growth we have seen in the West End since 2007, is a positive development for landlords and investors”.
He added: “Looking forward, we expect modest growth over the remainder of the year”.
The West End is the world’s most expensive place to lease an office space. Offices in Mayfair and St. James’s Square garner the highest rents and are taken up by hedge funds and financial firms, which benefit from the close proximity to nearby banking clients.